Vancouver Stock Exchange Vancouver Market touches new low

The Vancouver Stock Exchange’s Composite Index dipped below the 500 level over the period ended Jan. 22, 1991, touching down at 499.2 for yet another record low. The Resources Index followed suit, plunging over 27 points to finish at 550.15.

The indices’ performance was not helped by gold which, despite the outbreak of war in the Middle East, dropped from US$403 per oz. to a low of US$375 before rebounding to the US$380 level.

This was the first week of trading for Prime Equities which was spun off to shareholders of Prime Resources Group on the basis of 1.5 new shares for each five shares of Prime held.

Prime Equities traded as high as $1.10 before finishing the period at 83 cents.

Prime Resources shed 45 cents, or almost twice the equivalent value of the stock dividend, to close at $3.55 on Jan. 22, 1991.

Tagish Resources and its backer, Lytton Minerals (TSE), appear to have lost an important round in the battle to gain control of the Eskay Creek deposit, 50% owned by Prime. The Chief Gold Commissioner of British Columbia recently ruled against the challenge to certain claims hosting the bulk of reserves at Eskay Creek. Industry reaction to the ruling has been overwhelmingly positive.

Although the ruling is likely to be appealed, local market watchers expect it has taken the wind out of Tagish’s sails. Ongoing legal battles will be expensive, and we gather Lytton has been about town seeking financial support for its legal efforts on behalf of Tagish. Even Murray Pezim was approached with an offer “to get Eskay Creek back from Corona” — an offer he could and did refuse.

Uncertainty arising from the Gulf situation has put project financing for the Gulfstream project near Revelstoke on hold. Owners Bethlehem Resources and Goldnev Resources have arranged a financing and concentrate purchase agreement with Nippon Mining and Sumitomo but final signing of the deal has been postponed. Goldnev shed 20 cents over the period, closing at 80 cents while Bethlehem remained unchanged at the 40 cents level.

Market uncertainty did not seem to help Crown Resources which dropped $1 1/2 to finish at $10 on Jan. 22, 1991.

Dayton Development completed a private placement of convertible debentures over the period netting $3.02 million. The funds will be used for continued development of the company’s Andacollo gold project in Chile. Dayton added 12 cents finishing at $1.77.

Akiko-Lori Gold Resources dropped 60 cents to $3.25 after announcing plans to acquire Bradner Resources on the basis of one Akiko share for two Bradner shares. Brander remained unchanged at the $1.60 level.

Miramar Mining continued its new year downward spiral, sliding a further 22 cents to finish at $1.60. Miramar was trading at the $2.50 level at year-end. Little information has been released from the 1990 exploration program on the company’s much-touted Bruner project in Nevada. Newmont Mining is earning a 51% interest in the property.